At Microsoft's Build developer conference last week, the company's head of AI security accidentally leaked details of its partnership with Walmart.
The leak happened when employees protesting Microsoft's selling products and services to the Israeli military interrupted a presentation at the conference. The executive was streaming and switched over to a Teams message saying Walmart was ready to "rock and roll" on Microsoft's Entra Web and AI Gateway services.
Walmart and Microsoft have for years boasted of a partnership, but the companies don't disclose much about the relationship.
A separate leaked document viewed by Business Insider shows just how big of a customer Walmart is.
The document reveals that Walmart spent about $580 million on Microsoft's Azure cloud services between June 2023 and May 2024. Microsoft and Walmart declined to comment.
The software giant discloses relatively few financial details about its crucial cloud operation. Analysts get an Azure percentage growth rate from the company each quarter; they estimate actual revenue.
The document seen by BI provides a rare look at Azure financials and focuses on a key metric within Microsoft called Azure Consumed Revenue. Also known as ACR, this measures the dollar value of Azure services consumed by customers, whether they paid a full retail rate or a discounted rate.
Walmart spent about $580.4 million on Azure cloud services from July 2023 through May 2024, according to the document. The company's monthly ACR went from nearly $50 million in July 2023 to around $45 million in May 2024, with a peak of nearly $61.9 million in November 2023. That peak tracks with ramping up for the holiday season.
Companies don't typically reveal their cloud spending, except when securities laws require them to disclose multiyear cloud commitments. The Information reported last year that TikTok was spending about $20 million a month on Microsoft's Azure OpenAI service, citing a person who had seen the financials.
Walmart and Microsoft in 2018 announced a partnership in which the retail giant would choose Azure as its "preferred and strategic cloud provider." Walmart operates a huge online store and marketplace and, as a rival to Amazon, may be less likely to use Amazon Web Services as a cloud provider.
In 2024, Microsoft and Walmart bolstered their partnership by announcing a generative-AI-powered search function built on the Azure OpenAI service. It made Walmart one of Microsoft's marquee generative AI customers.
The internal document obtained by BI isn't clear on which type of ACR is being discussed. Microsoft has different ways to slice ACR. ACR with MACC, or Microsoft Azure Consumption Commitment, includes spending toward a pre-committed amount for which the customer includes a discount. ACR with PIN, or Partner Influenced Number, would also include revenue generated through a partner.
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